Beneficiary Declaration
I was recently informed that a close friend listed me as a beneficiary to her TIRA account. However, I am not the only beneficiary. The custodian is being less than effusive over the number of beneficiaries to the IRA and my portion/share. They could only disclose verbally.
I had requested a copy of the Beneficiary Declaration and they refused.
I offered to have the other beneficiary names redacted if this would assist.
They still refused.
I planned on using the funds as down payment on a property. I did get the custodian to draft a letter for a loan officer who was requesting documentation for my source of down payment, however there is still no Beneficiary Declaration form as created by my now deceased friend. Since the TIRA has not been moved to an Inherited IRA yet, there has been no settling of the account.
If I sign my paperwork creating an Inherited IRA based solely on their word as to the percentage, and that percentage was less than my friend had designated, is it possible that I would be disclaiming a portion of the share or is the act of disclaiming all or nothing?
Permalink Submitted by Alan - IRA critic on Mon, 2021-02-08 22:21
Disclaimers can be either partial or total. If you establish an inherited IRA to receive whatever amount your portion of the TSP actually is, you are not disclaiming anything regardless of the amount that transfers. A disclaimer is a separate legal document that you would have to prepare to submit to the TSP, and would likely just increase the amount inherited by the others. You just have an inherited IRA with a balance that is either more or less than what your friend indicated, and the only impact of that is not knowing the actual amount until you submit all the beneficiary info or even have it transferred into an inherited IRA. You also need to submit a death certificate and your beneficiary info such as contact info and SSN in order to establish the inherited IRA. Most inherited IRA custodians will handle the transfer, although I think the TSP will have special forms to complete. Hopefully, your name was not misspelled on the TSP beneficiary clause or that could cause delays. Unless you have other funds available, you probably cannot close on the property until the inherited IRA is funded and the distribution is made. Note that unless you inherited Roth TSP funds which would have to be transferred to an inherited Roth IRA, your inherited IRA distributions will be taxable and a large distribution could spike your tax rates for the year of the distribution.